Sole-sourcing, or ACAN procurements by INAC and other federal departments are and should be a major concern of Aboriginal peoples and organizations, particularly as it is being implemented by the Harper government. As stated in the last blog article, the preferential means of selecting and awarding Aboriginal funds to non-aboriginal recipients is inappropriate and violates the Federal governments a variety of own policies.
The major concern should be that Aboriginal policy and decision-making is being outsourced to private non-aboriginal interests. Aboriginals are not only being denied competitive participation in such matters but that they are being cut out of the INAC process entirely by sole-source procedures. This has to be addressed immediately. Native peoples for whom the INAC policies are designed must take a more active stance in how such monies are being used.
What could possibly go wrong?
You could say that $25,000 is not a lot of money but the issue may not be that simple. Theoretically, a $25,000 contract may only be the tip of the iceberg in a broader scheme. With a clever rewrite, a related ACAN can be generated to piggyback off the existing one. The same sole-source can then be selected for the next contract, especially if the previous one was never challenged. To take it a step further, larger contracts could also be created down the line in which the original sole-source grantee would then be the most qualified competitor as the result of the gateway ACAN. This stepping-stone arrangement could potentially lead to hundreds of thousands or even millions in government contracts, if inside influences are exploited.
In fact there have been complaints recently of similar abuses of the system. CTV.ca (1) has reported that four sole-source contracts, each worth $21,000 but renewable for up to $84,000 for three additional years, were posted on a contracting website last September. The first term runs until Nov. 9 this year. So the $25,000 limit can be easily circumvented at the whim of the government. Spokeswoman Annie Trepanier said in an email that Public Service Commission no rules were broken. “The PSC has met all the contracting requirements of the government of Canada,” That is open to interpretation but it is evident that the government shows no hesitation in bending, twisting, and otherwise abusing the policies in place.
The CTV report goes on to demonstrate another abuse of the ACAN mechanism, the claim that recipients of the contracts are the only ones capable of performing the job described. In a blatant misrepresentation of this each posting said there would be no job competition because “only one person is capable of performing the work” — even though the job description was identical in all four cases and four different candidates were awarded the jobs.
So to summarize, a total of at least $336,000 in contracts is divided up among four preferred providers in an uncompetitive manner under the ACAN procedure that has been clearly violated.
The process of sole-sourcing has grown under the Harper administration in all departments. Kathryn May in the Ottawa Citizen (2) reports that “The vast majority of the nearly 370,000 contracts the government issued in 2008 were less than $25,000 and 60 per cent of them were given to preferred suppliers without any competition.
The article goes on further to say that this trend is highly unusual: “Procurement Ombudsman Shahid Minto said he’s puzzled the number of sole-source contracts has remained the same over the past decade despite new policies that should have reduced them.”
However, not only has sole-sourcing remained unaffected, there are now plans to increase non-competitive ACAN by raising the ceiling from the current $25,000 limit to $30,000 resulting in even less transparency and fair competitive marketplace for providers. Under the existing system the Federal Government can use ACANs to provide contracts without scrutiny or explanation to potential “good ol’ boy” contractors (a former employee perhaps).
Is sole-sourcing preferred privatization?
According to the CTV report a business magazine compared ACANs with a “race where one contestant gets a head start, before the others even know there’s a race.”
Given the case in the last article and the examples given here, it seems that the dispensation of contracts is in relatively few hands. The preferred component of the sole-sourcing also means that select private individuals or companies can be accommodated for exclusive opportunities to public money. It is not comforting that projects that impact policy-making is outsourced to private interests. Non-aboriginal companies in particular cannot be permitted to start-up and grow on aboriginal set-aside programs in which aboriginal interests are excluded from participation.
It is for that reason that Aboriginals affected by INAC applications of funding and projects must be diligent and seek more direct involvement in the consultation process and be guaranteed access to INAC funded contracts. If even one contractor has a negative bias it could affect reports or operations impacting economic and social development. This may be particularly true if the contractor, previously in the employ of INAC was, and would be, involved in policy defining projects.
References:
(1) Federal agency accused of sole-sourcing contracts, CTV.ca Ottawa, Mar. 28 2010, http://edmonton.ctv.ca/servlet/an/local/CTVNews/20100328/OTT_public_service_contracts_100328/20100328
(2) Majority of federal contracts sole-sourced, report shows, Kathryn May, The Ottawa Citizen July 19, 2010, http://www.ottawacitizen.com/life/Majority+federal+contracts+sole+sourced+report+shows/3294294/story.html#ixzz0uBxSoZao
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